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DolphIn Laboratories Pvt. Ltd. Vs. Kaptab Pharmaceuticals - Court Judgment

LegalCrystal Citation
SubjectIntellectual Property Rights
CourtKolkata High Court
Decided On
Case NumberSuit No. 174 of 1980
Judge
Reported inAIR1981Cal76
ActsTrade and Merchandise Marks Act, 1958 - Sections 27(2) and 120
AppellantDolphIn Laboratories Pvt. Ltd.
RespondentKaptab Pharmaceuticals
Excerpt:
- .....it intended to manufacture from the said drug and applied for registration of the name to the trade mark authorities on the 23rd dec., 1978. this application is pending. subsequent thereto, on the 4th jan., 1979 the drug controller, government of india approved manufacture of medicines from the said drug in india and on the 11th jan., 1979 granted permission to the plaintiff to manufacture medicines from the said drug.2. thereafter, on the 25th jan., 1979, the plaintiff applied to the bureau of industrial costs and prices, government of jndia for approval of prices of medicines to be manufactured from the said drug under the drugs (prices and control) order 1970. the plaintiff also applied to the directorate of drugs control, government of west hen-gal for permission to manufacture.....
Judgment:
ORDER

Dipak Kumar Sen, J.

1. The item in dispute in this suit is a drug known as 'Amoxycilin Tri-hydrale' hereinafter referred to as the said drug. The plaintiff, a private limited company, has its registered office in Calcutta and carries on the business of manufacture and sale of medicines and pharmaceutical products. The plaintiff's case is that it decided to manufacture medicines from the said drug and on the 13th Feb., 1976 applied to the Drugs Controller, Government of India for necessary permission. Pursuant to directions of the said authority the plaintiff arranged for clinical trial of the said drug in India in 1976. The trial was successful. The plaintiff thereafter invented the name 'Amotid' for the medicine it intended to manufacture from the said drug and applied for registration of the name to the Trade Mark Authorities on the 23rd Dec., 1978. This application is pending. Subsequent thereto, on the 4th Jan., 1979 the Drug Controller, Government of India approved manufacture of medicines from the said drug in India and on the 11th Jan., 1979 granted permission to the plaintiff to manufacture medicines from the said drug.

2. Thereafter, on the 25th Jan., 1979, the plaintiff applied to the Bureau of Industrial Costs and Prices, Government of jndia for approval of prices of medicines to be manufactured from the said drug under the Drugs (Prices and Control) Order 1970. The plaintiff also applied to the Directorate of Drugs Control, Government of West Hen-gal for permission to manufacture medicine from the said drugs on the 31st Jan., 1979. Such permission was granted to the plaintiff on the 8th March, 1979. On the 29th March, 1979 the plaintiff informed the Drugs Controller, West Bengal that the said medicine was to be sold under the trade mark 'Amotid'. This proposal was accepted by the Drug Directorate of West Bengal on the 23rd July, 1979.

3. Thereafter on the I2th Sep., 1979 prices of the medicines to be prepared from the said drug as proposed by the plaintiff were approved by the Bureau of Industrial Costs and Prices and in Nov., 1979 the plaintiff started manufacturing medicine under the name 'Amotid' for commercial purposes and proceeded to advertise the product. The plaintiff commenced sales of the said medicines in open market all over India on and from the 4th Feb., 1980 excepting the States of Jammu and Kashmir, Himachal Pradesh, Gujarat and Madhya Pradesh.

4. The defendant is a partnership firm also carrying on the business of manufacture and sale of medicine and pharmaceutical products. It is the case of the defendant that it intended to use the drug Amoxycilin for manufacture of medicine and also coined and invented the trade mark 'Amotid' for its proposed products. The defendant applied to the Director, Drugs Control Administration, Gujarat Slate, Ahmedabad for permission to manufacture medicines under the mark 'Amotid' and on the 3rd November 1978 obtained such permission. The defendant also applied to the Drugs Controller, Government of India for permission to manufacture medicines out of the said drug and obtained such permission on the 15th February 1979. On the same date the defendant was granted permission to im-port the said drug. On the 12th April, 1979 the defendant obtained from the Director, Drugs Control Administration, Gujarat permission to manufacture out of the said drug medicine under the mark 'Amolid' and started such manufacture on and from the 21st June 1979. It is the defendant's case that it sells its products in Gujarat, Madhya Pradesh and Rajasthan.

5. This suit was instituted after a letter dated the 19th February 1980 was written on behalf of the defendant to the plaintiff alleging that since June 1979 the defendant had been selling medicines under the trade mark 'Amotid' which was invented by the defendant in 1978. It was further alleged that the plaintiff was selling products wrongfully under a trade mark identical and/or similar to the mark used by the defendant and that the acts of the plaintiff amounted to passing off. The plaintiff was called upon to discontinue the sale of its products under the said trade mark and withdraw the same failing which the plaintiff was threatened with legal proceedings.

6. The plaintiff instituted this suit on the 3rd March 1980 with leave under Clause 12 of the Letters Patent under Section 120 of the Trade and Merchandise Marks Act, 1958 hereinafter referred to as the Act claiming, inter alia, a declaration that the plaintiff was entitled to use the said trade mark 'Amotid' in respect of its products, a further declaration that the said letter dated the 19th Feb., 1980 contained a threat of legal proceeding which was unjustified, a perpetual injunction restraining the defendant, its servants and agents from interfering with the plaintiff's use of the said trade mark and/or in any way carrying on or continuing the groundless threat contained in the said letter or from making similar threats.

7. The plaintiff also moved the present application in the suit praying inter alia, for an interim injunction as follows :

'An injunction do issue restraining the defendant and/or its servants and/or agents and/or assigns from in any way interfering with your petitioner's use of the said mark and/or trade mark and/or trade name Amolid and/or from in any way carrying out or giving any effect whatsoever to the threats or any of the (sic) contained in the said circular and/or a letter dated 19th February 1980 being annexure 'A' hereto, or any like or similar threat by any action or in any manner and/or from giving any and/or any further effect to the said circular and/or letter dated 19th February, 1980 being Annexure 'A' (19) hereto in any manner whatsoever' until disposal of the suit.'

On the 3rd March 1980 an ad interim order was passed in terms of the said prayer.

8. An affidavit affirmed by one Kantilal Lallbhai Patel affirmed on the 6lh May 1980 has been filed on behalf of the defendant in opposition to this application and one affidavit of Shantilal Hirachand Buaria has been filed on behalf of the plaintiff in reply thereto.

9. At this stage it may be convenient to refer to the relevant provisions of the Act. 'Section 27.

(1) No person shall be entitled to institute proceeding to prevent, or to recover damages for infringement of an unregistered trade mark.

(2) Nothing in this Act shall be deemed to affect rights of action against any person for passing off' goods as the goods of another person or the remedies in respect thereof. Section 105. No suit--

(a) for the infringement of a registered trade mark; or

(b) relating to any right in a registered trade mark; or

(c) for passing off arising out of the use by the defendant of any trade mark which is identical with or deceptively similar to the plaintiff's trade mark, whether registered or unregistered;

shall be instituted in any court inferior to a District Court having jurisdiction to try the suit.'

'Section 106(1). The relief which a court may grant in any suit for infringement or for passing off referred to in Section 105 includes an injunction (subject to such terms, if any, as the court thinks fit) and at the option of the plaintiff, either damages or an account of profits, together with or without any order for the delivery of the infringing labels and marks for destruction or erasure.'

Section 120(1) Where a person, by means of circulars advertisements or otherwise, threatens a person with an action or proceeding or infringement of a trade mark which is registered, or alleged by the first-mentioned person to be registered, or with some other like proceeding, a person aggrieved may, whether the person making the threats is or is not the registered proprietor or the registered user of the trade marks, bring a suit against the first mentioned person and may obtain a declaration to the effect that the threats are in justifiable, and an injunction against the continuance of the threats, and may recover such damages (if any) as he has sustained, unless the first-mentioned person satisfies the court that the trade mark if registered and that the acts in respect of which the proceedings were threatened constitute, or, if done, would constitute, an infringement of the trade mark.

(2) The last preceding sub-section does not apply if the registered proprietor of the trade mark, or a registered user acting in pursuance of Sub-section (1) of Section 51, with due diligence commences and prosecutcs an action against the person threatened for infringement of the trade mark.'

10. Learned counsel cited and relied on the aforesaid sections from the Bar in support of their respective contentions. It was contended on behalf of the plaintiff, inter alia, that the plaintiff had put on record its claim to the mark 'Amotid' earlier than the defendant and that it had explored the possibility of use of the said drug long before the defendant. Only because the plaintiff was a large scale manufacturing unit it had to obtain the approval of the authorities for fixing the price of its products and therefore its products were marketed later than those of the defendant. The defendant was a small scale manufacturing unit which has come into existence only recently and its sales were confined to limited areas. It was further contended that the plaintiff had applied for registration of mark 'Amotid' long before the defendant and that the application was pending before the Registrar of Trade Marks. It was contended that in the facts and circumstances there could be no question of passing off by the plaintiff and that the defendant's threats of proceedings inter alia, contained in the letter dated the 19th February 1980 were prima facie groundless within the meaning of Section 120 of the Act

11. Learned Counsel submitted further that in the instant case the defendant has threatened the plaintiffs with actions or proceedings which were proceedings in the nature of infringement of a trade mark. The plaintiff aggrieved thereby has filed this suit for reliefs provided in Section 120 of the Act. The plaintiff is entitled to an interim injunction restraining the continuance of the threats pending the hearing of the suit. If in continuance of such threats the defendant intended to file any proceedings including a suit for passing off, the latter should also be restrained at this stage for implementing its threats in that manner. Otherwise the reliefs provided by the section and the claims in the suit would become nugatory.

12. Learned counsel submitted that the scheme of the Act and in particular Chap. Xl thereof indicated that proceedings for infringement of a trade mark and proceedings against passing off have always been treated as like proceedings. Both in Sections 105 and 106 of the Act the said two types of suits are considered together.

13. Learned Counsel sought to interpret Section 27 of the Act and submitted that the two sub-sections of the section must be read together and this would show that Section 27 did not override the right of a person to proceed under Section 120 of the Act.

14. Learned 'Counsel for the defendant contended on the other hand that in the instant case Section 120 had little relevance inasmuch as the scheme of Act and the said section indicated that reliefs provided therein related to cases where only a question of infringement of a registered trade mark was involved. He submitted that it was common case that the trade mark in dispute had not been registered in favour of any one as yet and that the matter was pending before the Registrar of Trade Marks. It was also the admitted case that the defendant had come into the market first with the product with the mark in dispute and therefore it could not be said that the threat, if any, from the defendant was entirely groundless. He submitted that under Sub-section (2) of Section 27 of the Act the right of a person to file a suit for passing off could not be taken away and the expression 'nothing in the Act' included Section 120.

15. No reported decision on the said section could be cited from the Bar and the matter appeared to be one of first impression.

16. In the facts and circumstances and on the records before me it appears prima facie that the plaintiff first conceived the idea of exploring the said drug in the market and took necessary steps in introducing the drug in India and prima facie put its claim to the name or mark 'Amotid' first. But the fact remains that the defendant also proceeded to exploit the drug though at a later stage. By virtue of circumstances the defendant was able to come to the market first with products of the drug in the same name or mark. The plaintiff's application for registration of the mark was filed before that of the defendant. Both the applications are pending.

17. It further appears to me that by the letter dated the 19th February, 1980 the defendant undoubtedly has issued a threat to the plaintiff. Learned Counsel for the defendant clearly submitted that the defendant intended to file a suit against the plaintiff for passing off. I am of the view that a suit for passing off may be deemed to be a proceeding similar in nature to a proceeding in respect of the infringement of a trade mark within the meaning of Section 120 of the Act. Therefore it cannot be held that the present suit is not maintainable.

18. But the real controversy in this application is whether the plaintiff in its suit under Section 120 of the Act is entitled to restrain the defendant from filing a suit complaining passing off. The section itself do not provide that a person against whom a suit has been filed thereunder can be restrained from filing any other suit in his favour. Had the defendant filed a suit for passing off without any notice to the plaintiff I am not sure whether the plaintiff could have proceeded under Section 120 of the Act to restrain the defendant from proceeding with the said suit. It also appears to me that Sub-section (2) of Section 27 of the Act clearly and in no uncertain terms upholds the right of a person to file a suit for passing off irrespective of any other provision in the Act.

19. I am unable to accept the contention of the plaintiff that while restraining a person from making unjustified threats it is also open to the Court to restrain him from taking the matter to a Court of Law and from agitating his rights there. The right to institute a suit is an important and vital right and it is settled law that unless there is an express statutory bar the right of a person to institute a suit should not normally be interfered with. If the contentions of the plaintiff are accepted then the Court is called upon to pass an order restraining the defendant from instituting a suit. This order cannot be made directly in terms of Section 120.

20. It appeared to me that Section 120, of the Act is intended to give relief in cases where irresponsible and unjustified threats are made and publicised in order to injure and other person's trade. In such cases the per-son threatened would be entitled to come to Court and have it adjudicated that such threats are groundless. But the said section in my view is not intended to prevent a person from instituting a suit alleging passing off.

21. For the reasons above the plaintiff will only be entitled to an order in this application to the extent as follows :-- The defendant will be restrained by an interim order of injunction from further threatening the plaintiff for the latter's user of the trade mark in dispute and from publishing circulars or advertisement holding out such threats. I, however, make it clear that the defendant will be entitled to file a suit if it is so advised in an appropriate forum alleging passing off and agitate its claim there. I also make it clear that this order is without prejudice to the rights and contentions of the parties and the plaintiff if so advised would be at liberty to apply for having the suit of the defendant, if any, stayed or take any other steps in such suit on the ground as it may be advised.

22. Costs, costs in the suit.

23. On an application made on behalf of the plaintiff, the operation of this order is for a fortnight.


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